Diamond Fields International Ltd. [DFI-TSXV] provided an update on its Namibian, offshore, diamond concessions. International Mining and Dredging Holdings (Pty) Limited (“IMDH) and the company have agreed to an initial mining program on its ML 111 licence. The initial mining program is scheduled to commence in 2018 and will extend over a sea floor area of approximately 55 hectares.
The program is to be executed using the state of the art Ya Toivo mining vessel which is equipped with a four-point-mooring-system integrated anchor-assist and a dynamic positioning (DP2) system which ensures vessel stability during turbulent sea conditions. The vessel is further equipped with a Remotely Operated Subsea Tractor, capable of highly efficient and selective mining on the sea floor.
Diamond Fields has further concluded discussions with IMDH concerning its share of the 2016 bulk sampling program. All costs associated with this multi-million dollar program were paid for by IMDH. The parties have agreed that Diamond Fields will be paid US $670,000 within 30 days.
The results from the bulk sampling program were extremely encouraging, with an unexpected high frequency of large, high value stones. Diamonds recovered from the company’s ML 111 in Namibia are typically of the highest gem quality, but recent bulk sampling results have exceeded expectations.
It has been agreed for the duration of the forthcoming initial mining program, and dependent on monthly production levels, that the Diamond Fields share of net proceeds (after costs) shall be not less than 5% and the company anticipates that it could approach 50% of its joint venture interest (i.e., 10% of total proceeds before tax and after deduction of export levies).
The parties expect to review mining costs and other parameters during the initial mining program to find a balance for sharing exploration and mining costs going forward beyond the initial mining program, particularly regarding resource and reserve development.
Sybrand Van Der Spuy, CEO of DFI said, “We are extremely excited at the prospect of being back in production in the very near future. Our product is recognized throughout the world for its exceptional quality, being 98% gem and we look forward to bringing this niche product back to the market again. This program will provide our company with the opportunity to generate significant cash-flow in short order.”